Indonesia imposes safeguard duty on wire rod imports

JAKARTA (Scrap Monster): As per industry sources, the Indonesian Safeguards Committee (KPPI) has proposed safeguard measure in the form of import duty to be applied on wire rod imports. The decision is being announced to prevent further injury to domestic producers.

The country has decided to impose import duties on hot rolled steel bar and rod in coil. The measures would include both carbon and alloy wire rod, it stated. The action follows investigations conducted into imports of wire rods ranging from 5.5mm to 20mm, following complaints raised in early January last year by domestic steel makers PT Krakatau Steel and PT Ispat Indo.

According to Indonesian Trade Safeguard Committee, the wire rod imports by the country witnessed dramatic rise from 222,876 tonnes in 2010 to 678,000 tonnes in 2013. The imports more than tripled during this period. In 2013, imports constituted almost three-fourth of the total market share, sending domestic mills to serious troubles. These wire rod products were dumped into the country at a much lower rate than those offered by domestic mills. The dumping of these products at almost 15% lower prices resulted led to huge drop in domestic capacity utilization rates.

China is the leading wire rod exporter to Indonesia. Post imposition of duties, the Chinese exports of boron-added rods face double blow. The Chinese administration had removed the VAT rebates on these products before.

The government has not announced the date from which these duties will be effective. Also, the rate of duties are yet to be announced.